Gino DiCaro

CARB hearing on GHG cap & trade

By Gino DiCaro, VP, Communications

Capitol Update, Dec. 10, 2010 Share this on FacebookTweet thisEmail this to a friend

California’s Air Resources Board (CARB) will conduct a public hearing on December 16th in Sacramento to consider the adoption of a “Proposed California Cap on Greenhouse Gas (GHG) Emissions and Market-Based Compliance Mechanisms Regulation, Including Compliance Offset Protocols.”

There are still many unknowns with the proposal. CMTA has long-advocated for implementing AB 32 in a way that allows California to reach the GHG reduction emission goals while at the same time maintaining the competitiveness of the state. Unfortunately, because of missing information and unfinished regulation, it is nearly impossible for regulated industries to estimate the potential costs and other impacts of the cap-and-trade regulation on their operations.

In the proposal, free allocation of allowances for all industrial sectors is allowed for the first compliance period but not for the second and third. CMTA has asked that the free allowances, up to the output-based benchmark for each sector, be applied to all periods up to 2020. We believe that AB 32 does not authorize CARB to raise revenue for purposes unrelated to administration of the program. In addition, imposing a broader auction in the second and third periods will only increase leakage (companies moving out of the state) by imposing higher costs on industry.

For more specificity on CMTA’s concerns, see our comments to CARB regarding the proposal: CMTA Cap & Trade Comments.pdf

For more information on CARB’s proposal and hearing: www.arb.ca.gov/regact/2010/ghg2010/ghg2010notice.pdf

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